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On-chain data shows that the Bitcoin exchange whale ratio rose just before the crypto plunged below the $19k level.
Bitcoin Exchange Whale Ratio Violated 90% Just Before Price Drop
As noted by an analyst in a CryptoQuant afterWhale activity has recently been brought up on exchanges.
the “swap whale ratio” is an indicator that measures the relationship between the top ten inflows and exchanges and total inflows.
The ten largest transfers are believed to come from the whalesso that the metric tells us what proportion of the total number of coins going to exchanges come from these giant holders.
When the value of this indicator is high, it means that a large part of the influx currently comes from whales. Such a trend could be a sign of dumping of this cohort and therefore could be bearish for the price.
On the other hand, low values of the ratio may indicate that whales are currently a healthy share of trades to exchanges. This kind of trend can be bullish or neutral to the value of the crypto.
Historically, the stat has typically had values above 0.85 during bear markets or fake bulls, while it has generally remained below this threshold during bull runs.
Here is a chart showing the trend in the Bitcoin exchange whale ratio over the past few months:
The value of the metric seems to have been elevated recently | Source: CryptoQuant
As you can see in the chart above, the Bitcoin exchange whale ratio shot up yesterday, reaching as high as 0.9, implying that whales contributed 90% of the inflow to the exchanges.
This spike in the indicator came not long before the price of the coin fell below $19k, suggesting that whale dumping may be behind the decline.
The ratio has also remained high since then, which could mean the cohort continues to plunge into exchanges, something that could turn out to be bearish for BTC.
At the moment of writing, The price of Bitcoin hovers around $19.3k, down 4% over the past seven days. Over the past month, the crypto lost 17% in value.
The chart below shows the trend in the price of the coin over the past five days.
Looks like the value of the crypto has rebounded back a little to above $19k again since the plunge yesterday | Source: BTCUSD on TradingView
Featured image from Karl-Heinz Müller on Unsplash.com, charts from TradingView.com, CryptoQuant.com